Ford and the Führer

by Ken Silverstein

The Nation magazine, January 24, 2000

... That Ford and a number of other American firms-including
General Motors and Chase Manhattan-worked with the Nazis has been
previously disclosed. So, too, has Henry Ford's role as a leader
of the America First Committee, which sought to keep the United
States out of World War II. However, the new materials, most of
which were found at the National Archives, are far more damning
than earlier revelations. They show, among other things, that
up until Pearl Harbor, Dearborn made huge revenues by producing
war materiel for the Reich and that the man it selected to run
its German subsidiary was an enthusiastic backer of Hitler, German
Ford served as an "arsenal of Nazism" with the consent
of headquarters in Dearborn, says a US Army report prepared in
1945.

Moreover. Ford's cooperation with the Nazis continued until
at least August 1942-eight months after the United States entered
the war-through its properties in Vichy France. Indeed, a secret
wartime report prepared by the US Treasury Department concluded
that the Ford family sought to further its business interests
by encouraging Ford of France executives to work with German officials
overseeing the occupation. "There would seem to be at least
a tacit acceptance by [Henry Ford's son] Mr. Edsel Ford of the
reliance...on the known neutrality of the Ford family as a basis
of receipt of favors from the German Reich," it says.

The new information about Ford's World War II role comes at
a time of growing attention to corporate collaboration with the
Third Reich. In 1998 Swiss banks reached a settlement with Holocaust
survivors and agreed to pay $ 1.25 billion. That set the stage
for a host of new Holocaust-related revelations as well as legal
claims stemming from such issues as looted art and unpaid insurance
benefits. This past November NBC News reported that Chase Manhattan's
French branch froze Jewish accounts at the request of German occupation
authorities. Chase's Paris branch manager, Carlos Niedermann,
worked closely with German officials and approved loans to finance
war production for the Nazi Army. In Germany the government and
about fifty firms that employed slave and forced labor during
World War II-including Bayer, BMW, Volkswagen and Daimler-Chrysler-reached
agreement in mid-December to establish a $5.1 billion fund to
pay victims. Opel, General Motors' German subsidiary, announced
it would contribute to the fund. (As reported last year in the
Washington Post, an FBI report from 1941 quoted James Mooney,
GM's director of overseas operations, as saying he would refuse
to do anything that might "make Hitler mad.") Ford refused
to participate in the settlement talks, though its collaboration
with the Third Reich was egregious and extensive. Ford's director
of global operations, Jim Vella, said in a statement, "Because
Ford did not do business in Germany during the war-our Cologne
plant was confiscated by the Nazi government-it would be inappropriate
for Ford to participate in such a fund."

The generous treatment allotted Ford Motor by the Nazi regime
is partially attributable to the violent anti-Semitism of the
company's founder, Henry Ford. His pamphlet The International
Jew: The World s Foremost Problem brought him to the attention
of a former German Army corporal named Adolf Hitler, who in 1923
became chairman of the fledgling Nazi Party. When Ford was considering
a run for the presidency that year, Hitler told the Chicago Tribune,
"I wish that I could send some of my shock troops to Chicago
and other big American cities to help." (The story comes
from Charles Higham's Trading With the Enemy, which details American
business cooperation with the Nazis.) In Mein Kampf, written two
years later, Hitler singled Ford out for praise. "It is Jews
who govern the stock exchange forces of the American Union,"
he wrote. "Every year makes them more and more the controlling
masters of the producers in a nation of one hundred and twenty
millions; only a single great man, Ford, to their fury, still
maintains full independence." In 1938, long after the vicious
character of Hitler's government had become clear, Ford accepted
the Grand Cross of the German Eagle, the Nazi regime's highest
honor for foreigners.

Ford Motor set up shop in Germany in 1925, when it opened
an office in Berlin. Six years later, it built a large plant in
Cologne, which became its headquarters in the country. Ford of
Germany prospered during the Nazi years, especially with the economic
boom brought on by World War II. Sales increased by more than
half between 1938 and 1943, and, according to a US government
report found at the National Archives, the value of the German
subsidiary more than doubled during the course of the war.

Ford eagerly collaborated with the Nazis, which greatly enhanced
its business prospects and at the same time helped Hitler prepare
for war (arid after the 1939 invasion of Poland, conduct it).
In the mid-thirties, Dearborn helped boost German Ford's profits
by placing orders with the Cologne plant for direct delivery to
Ford plants in Latin America and Japan. In 1936, as a means of
preserving the Reich's foreign reserves, the Nazi government blocked
the German subsidiary from buying needed raw materials. Ford headquarters
in Dearborn responded-just as the Nazis hoped it would-by shipping
rubber and other materials to Cologne in exchange for German-made
parts. The Nazi government took a 25 percent cut out of the imported
raw materials and gave them to other manufacturers, an arrangement
approved by Dearborn. According to the US Army report of 1945,
prepared by Henry Schneider, German Ford began producing vehicles
of a strictly military nature for the Reich even before the war
began. The company also established a war plant ready for mobilization
day in a "'safe' zone" near Berlin, a step taken, according
to Schneider, "with the. . .approval of Dearborn." Following
Hitler's 1939 invasion of Poland, which set off World War II,
German Ford became one of the largest suppliers of vehicles to
the Wehrmacht (the German Army). Papers found at the National
Archives show that the company was selling to the SS and the police
as well. By 1941 Ford of Germany had stopped manufacturing passenger
vehicles and was devoting its entire production capacity to military
trucks. That May the leader of the Nazi Party in Cologne sent
a letter to the plant thanking its leaders for helping "assure
us victory in the present [war] struggle" and for demonstrating
the willingness to "cooperate in the establishment of an
exemplary social state."

Ford vehicles were crucial to the revolutionary Nazi military
strategy of blitzkrieg. Of the 350,000 trucks used by the motorized
German Army as of 1942, roughly one-third were Ford-made. The
Schneider report states that when American troops reached the
European theater, "Ford trucks prominently present in the
supply lines of the Wehrmacht were understandably an unpleasant
sight to men in our Army." Indeed, the Cologne plant proved
to be so important to the Reich's war effort that the Allies bombed
it on several occasions. A secret 1944 US Air Force "Target
Information Sheet" on the factory said that for the previous
five years it had been "geared for war production on a high
level."

While Ford Motor enthusiastically worked for the Reich, the
company initially resisted calls from President Roosevelt and
British Prime Minister Churchill to increase war production for
the Allies. The Nazi government was grateful for that stance,
as acknowledged in a letter from Heinrich Albert to Charles Sorenson,
a top executive in Dearborn. Albert had been a lawyer for German
Ford since at least 1927, a director since 1930 and, according
to the Treasury report, part of a German espionage ring operating
in the United States during World War I. "The 'Dementi' of
Mr. Henry Ford concerning war orders for Great Britain has greatly
helped us," Albert wrote in July of 1940, shortly after the
fall of France, when England appeared to be on the verge of collapse
before the Führer's troops.

Ford's energetic cooperation with the Third Reich did not
prevent the company's competitors from seeking to tarnish it by
calling attention to its non-German ownership. Ford responded
by appointing a majority-German board of directors for the Cologne
plant, upon which it bestowed the politically correct Aryan name
of Ford Werke. In March of 1941, Ford issued new stock in the
Cologne plant and sold it exclusively to Germans, thereby reducing
Dearborn's share to 52 percent.

At the time, the Nazi government's Ministry of Economy debated
whether the opportunity afforded by the capital increase should
be taken to demand a German majority at Ford Werke. The Ministry
"gave up the idea"-this according to a 1942 statement
prepared by a Ford Werke executive-in part because "there
could be no doubt about the complete incorporation, as regards
personnel, organization and production system, of Ford Werke into
the German national economy, in particular, into the German armaments
industry." Beyond that, Albert argued in a letter to the
Reich Commission for Enemy Property, the abolition of the American
majority would eliminate "the importance of the company for
the obtaining of raw materials," as well as "insight
into American production and sales methods."

As 1941 progressed, the board of Ford Werke fretted that the
n United States would enter the war in support of Britain and
the government would confiscate the Cologne plant. m prevent such
an outcome, the Cologne management wrote to the Reich Commission
that year to say that it "question[ed] whether Ford must
be treated as enemy property" even in the event of a US declaration
of war on Germany. "Ford has become a purely German company
and has taken over all obligations so successfully that the American
majority shareholder, independent of the favorable political views
of Henry Ford, in some periods actually contributed to the development
of German industry," Cologne argued on June 18, 1941, only
six months before the bombing of Pearl Harbor.

In May of 1942, the Superior Court of Cologne finally put
Ford Werke in "trusteeship," ruling that it was "under
authoritative enemy influence." However, the Nazis never
nationalized Ford's German property-plant managers feared it would
be turned over to Mercedes or the Hermann Goering Werke, a huge
industrial network composed of properties seized by the Reich-
and Dearborn maintained its 52 percent share through the duration
of the war. Ford Werke even set aside dividend payments due to
Dearborn, which were paid after the war. Ford claims that it received
only $60,000 in dividend payments. It's not possible to independently
verify that-or anything else regarding Dearborn's wartime economic
relationship with Cologne-because Ford of America was privately
held until 1956, and the company will not make available its balance
sheets from the period.

Labor shortages caused by the war-millions of men were at
the front and Nazi ideology was violently opposed to the idea
of women working-led the Reich to deport millions of people from
occupied lands to Germany to work in factories. German companies
were encouraged to bid for forced laborers in order to meet production
quotas and increase profits. By 1943 half of Ford Werke's work
force comprised foreign captives, including French, Russians,
Ukrainians and Belgians. In August of 1944 a squad of SS men brought
fifteen prisoners from the Buchenwald concentration camp to Ford
Werke. The German researcher Karola Fings, co-author of Working
for the Enemy, a book on Nazi slave and forced-labor programs,
to be published this spring, says Ford's worker-inmates toiled
for twelve hours a day with a fifteen minute break. They were
given 200 grams of bread and coffee for breakfast, no lunch and
a dinner of spinach and three potatoes or soup made of turnip
leaves.

An account by Robert Schmidt, the man appointed to run Ford
Werke in 1939, states that the company used forced laborers |
even before the Nazis put the plant in trusteeship. His statement,
sent to a Ford executive in England immediately after Germany's
surrender, says that as of 1940 "many of our employees were
called to the colors and had to be replaced by whatever was available....
The same applies to 1941. Some 200 French prisoners of war were
employed." In a statement to the US Army in 1945, Schmidt
said that the Gestapo began to play an important role at Ford
Werke after the first foreign workers arrived. With the assistance
of W.M. Buchwald, a Ford employee since the mid-thirties, the
Gestapo carefully monitored plant activities. "Whenever there
was the slightest indication of anti-Nazi feeling, be it amongst
foreigners or Germans, the Gestapo tramped down as hard as possible,"
Schmidt told the Army.

Meanwhile, Ford Werke offered enthusiastic political support
for Hitler as well. The fraternal ties between Ford and the Nazis
is perhaps best symbolized by the company's birthday gift to the
Führer of 35,000 Reichsmarks in April of 1939. Ford Werke's
in-house publication couldn't have been more fanatically pro-Nazi
if Josef Goebbels had edited it. "Führer," the
poem printed at the top of this story, ran in the April 1940 issue,
which celebrated Hitler's 51st birthday by running his picture
on the cover. The issue carried an excerpt of a speech by Hitler
in which he declared that "by natural law of the earth, we
are the supreme race and thus destined to rule." In another
section of the speech, the Führer declared that communism
was "second in wretchedness only to Judaism." The issue
from April of the following year-this at roughly the high point
of the Third Reich's military victories- featured a photograph
of a beaming Hitler visiting with German soldiers on the front
lines. "The management of the Ford-Werke salutes our Führer
with grateful heart, honesty, and allegiance, and-as before-pledges
to cooperate in his life's work: achieving honor, liberty and
happiness for Greater Germany and, indeed, for all peoples of
Europe," reads the caption.

Robert Schmidt so successfully converted the plant to a war
footing that the Nazi regime gave him the title of Wehrwirtschaftsfuhrer,
or Military Economic Leader. The Nazis also put Schmidt in charge
of overseeing Ford plants in occupied Belgium, Holland and Vichy
France. At one point, he and another Cologne executive bitterly
argued over who would run Ford of England when Hitler's troops
conquered Britain.

Schmidt's personal contributions to Ford Werke's in-house
organ reflect his ardently pro-Nazi views. "At the beginning
of this year we vowed to give our best and utmost for final victory,
in unshakable faithfulness to our Führer," he wrote
in December of 1941, the same month as Pearl Harbor. "Today
we say with pride that we succeeded if not in reaching all our
goals, nevertheless in contributing to a considerable extent in
providing the necessary transportation for our troops at the front."
The following March, Schmidt penned an article in which he declared,
"It depends upon our work whether the front can be supplied
with its necessities.... therefore, we too are soldiers of the
Führer."

The Ford family and company executives in Dearborn repeatedly
congratulated the management of Ford Werke on the fine work they
were doing under the Nazis. In October of 1940 Edsel Ford wrote
to Heinrich Albert to say how pleased he was that the company's
plants in occupied lands were continuing to operate. "It
is fortunate that Mr. Schmidt is in such authority as to be able
to bring out these arrangements," said Edsel, who died of
cancer during the war. The same letter indicates that Ford was
quite prepared to do business with the Nazis if Hitler won the
war. Though it was difficult to foresee what would happen after
the fighting ended, Edsel told Albert, "a general rearrangement
of the ownership of our continental businesses may be required.
You will no doubt keep as close to this subject as possible and
we will have the benefit of your thoughts and suggestions at the
proper time."

"To know that you appreciate our efforts in your and
the company's interests is certainly a great encouragement,"
Albert replied the following month. He went on to praise Schmidt,
who had been forced to shoulder immense responsibilities after
war broke out. "In fulfilling his task his personality has
grown in a way which is almost astonishing." Indeed, Schmidt
grew to such a great degree that the Nazis kept him in charge
of Ford Werke after they put the company in trusteeship. In February
of 1942, when the question of who would run the Cologne plant
was still up in the air, a local Nazi official wrote to Hitler's
Chancellery in Berlin to put in a good word for Ford's man. The
official said he saw "no reason to appoint a special custodian
for the enterprise" since Schmidt was "a Party member
[who] enjoys my confidence and. . .the confidence of the German
Armed Forces."

Ford's behavior in France following the German occupation
of June 1940 illustrates even more grotesquely its collaborationist
posture. As soon as the smoke had cleared, Ford's local managers
cut a deal with the occupation authorities that allowed the company
to resume production swiftly-"solely for the benefit of Germany
and the countries under its [rule]," according to a US Treasury
Department document. The report, triggered by the government's
concern that Ford was trading with the enemy, is sharply critical
of Maurice Dollfus, a Ford director in France since 1929 and the
company's manager during the Vichy period. "Mr. Dollfus was
required by law to replace directors, and he selected the new
directors exclusively from the ranks of prominent collaborationists,"
says the Treasury report. "Mr. Dollfus did this deliberately
to curry favor with the authorities." The report refers to
another Ford employee, a certain Amable Roger Messis, as "
100% pro-German."

The Treasury Department found that Ford headquarters in Dearborn
was in regular contact with its properties in Vichy France. In
one letter, penned shortly after France's surrender, Dollfus assured
Dearborn that "we will benefit from the main fact of being
a member of the Ford family which entitles us to better treatment
from our German colleagues who have shown clearly their wish to
protect the Ford interest as much as they can." A Ford executive
in Michigan wrote back, "We are pleased to learn from your
letter...that our organization is going along, and the victors
are so tolerant in their treatment. It looks as though we still
might have a business that we can carry on in spite of all the
difficulties." The Ford family encouraged Dollfus to work
closely with the German authorities. On this score, Dollfus needed
little prodding. "In order to safeguard our interests-and
I am here talking in a very broad way-I have been to Berlin and
have seen General von Schell himself," he wrote in a typed
note to Edsel in August of 1940. "My interview with him has
been by all means satisfactory, and the attitude you have taken
together with your father of strict neutrality has been an invaluable
asset for the protection of your companies in Europe." (In
a handwritten note in the margin, Dollfus bragged that he was
"the first Frenchman to go to Berlin.") The following
month Dollfus complained about a shortage of dollars in occupied
France. This was a problem, however, that might be merely temporary.
"As you know," he wrote Dearborn at the time, "our
[monetary] standard has been replaced by another standard which-in
my opinion-is a draft on the future, not only in France and Europe
but, maybe, in the world." In another letter to Edsel, this
one written in late November of 1940, Dollfus said he wanted to
"outline the importance attached by high officials to respect
the desires and maintain the good will of 'Ford'-and by 'Ford'
I mean your father, yourself and the Ford Motor Company, Dearborn."

All this was to the immense satisfaction of the Ford family.
In October of 1940, Edsel wrote to Dollfus to say he was "delighted
to hear you ate making progress.... Fully realize great handicap
you are working under." Three months later he wrote again
to say that Ford headquarters was "very proud of the record
that you and your associates have made in building the company
up to its first great position under such circumstances."

Dearborn maintained its communication with Ford of France
well after the United States entered the war. In late January
of 1942, Dollfus informed Dearborn that Ford's operations had
the highest production level of all French manufacturers and,
as summed up by the Treasury report, that he was "still relying
on the French government to preserve the interests of American
stockholders."

During the following months, Dollfus wrote to Edsel several
times to report on damages suffered by the French plant during
bombing runs by the Royal Air Force. In his reply, Edsel expressed
relief that American newspapers that ran pictures of a burning
Ford factory did not identify it as a company property. On July
17, 1942, Edsel wrote again to say that he had shown Dollfus's
most recent letter to his father and to Dearborn executive Sorenson.

"They both join me in sending best wishes for you and
your staff, and the hope that you will continue to carry on the
good work that you are doing," he said.

As in Germany, Ford's policy of sleeping with the Nazis proved
to be a highly lucrative approach. Ford of France had never been
very profitable in peacetime-it had paid out only one dividend
in its history-but its service to the Third Reich soon pushed
it comfortably into the black. Dollfus once wrote to Dearborn
to boast about this happy turn of events, adding that the company's
"prestige in France has increased considerably and is now
greater than it was before the war."

Treasury Department officials were clearly aghast at Ford's
activities. An employee named Randolph Paul sent the report to
Secretary Henry Morgenthau with a note that stated, "The
increased activity of the French Ford subsidiaries on behalf of
the Germans received the commendation of the Ford family in America."
Morgenthau soon replied, "If we can legally and ethically
do it, I would like to turn over the information in connection
with the Ford Motor Company to Senator [Harry] Truman."

Lydia Cisaruk, the Ford spokeswoman, says that Ford Werke's
pre-Pearl Harbor support for the Third Reich was largely unknown
to company headquarters. Neither of the two Dearborn executives
on Ford Werke's board, Edsel Ford and Charles Sorenson, attended
board meetings after 1938. "By 1940, Dearborn was becoming
less and less involved in day-to-day operations," she says.
"There was a gradual loss of control." Asked about Ford
Werke's political support for the Nazis, as seen in its in-house
newsletter, she replied: "Looking at the years leading up
to the war, no one could foresee what was going to happen. A number
of countries were negotiating with Germany and Germany was repeatedly
saying that it was interested in peaceful solutions. The United
States was talking to Germany until the two countries went to
war." She concedes that some "foreign" labor was
employed at the plant beginning in 1940, but says Dearborn had
no knowledge of that at the time. Ford is currently conducting
an exhaustive investigation into Ford Werke, she says. When the
research is completed this year, the company will make available
all of the documentary evidence it has accumulated, including
financial records. While Ford did not take part in the German
slave-labor talks, Cisaruk says it is in preliminary discussions
with Deputy Treasury Secretary Stuart Eizenstat to establish a
humanitarian US-based fund for Holocaust survivors. "We do
want to help people who suffered at the hands of the Nazis,"
she says.

Production at Ford Werke slowed at the end of the war, in
part because of power shortages caused by Allied bombing runs,
but activity never came to a halt. Soon after Germany's capitulation,
Ford representatives from England and the United States traveled
to Cologne to inspect the plant and plan for the future. In 1948
Henry Ford visited Cologne to celebrate the 10,000th truck to
roll off the postwar assembly line there. Two years later, Ford
of Germany rehired Schmidt-who had been arrested and briefly held
by US troops at the war's end- after he wrote a letter to Dearborn
in which he insisted that he had fervently hated the Nazis. He
was one of six key executives from the Nazi era who moved back
into important positions at Ford after 1945. "After the war,
Ford did not just reassume control of a factory, but it also took
over the factory's history," says historian Fings. "Apparently
no one at Ford was interested in casting light upon this part
of history, not even to explicitly proclaim a distance from the
practices of Ford Werke during the Nazi era." Schmidt remained
with Ford until his death in 1962.

The high point of Ford's cynicism was yet to come. Before
its fall, the Nazi regime had given Ford Werke about $ 104,000
in compensation for damages caused by Allied bombings (Ford also
got money for bombing damages from the Vichy government). Dearborn
was not satisfied with that amount. In 1965 Ford went before the
Foreign Claims Settlement Commission of the US to ask for an additional
$7 million. (During the hearings, commission attorney Zvonko Rode
pointed to the embarrassing fact-which Ford's attorney did not
dispute-that most of the manufactured products destroyed during
the bombings had been intended for the use of the Nazi armed forces.)
In the end, the commission awarded the company $ I. I million-but
only after determining that Ford had used a fraudulent exchange
rate to jack up the size of the alleged damages. The commission
also found that Dearborn had sought compensation for merchandise
that had been destroyed by flooding.

Ford's eagerness to be compensated for damages incurred to
Ford Werke during the Nazi era makes its current posture of denying
any association with the wartime plant all the more hypocritical.
These new revelations may force Ford to reconsider its responsibilities
with regard to slave labor. In the meantime, new legal developments
could also create problems for the company. Last year California
passed a law that extends the statute of limitations on Holocaust-related
claims. In November Senator Charles Schumer of New York introduced
a bill in Congress that would do the same thing at the federal
level.

Ken Silverstein is a Washington, DC-based writer His book
Private Warriors, which examines post-cold war military and arms-dealing
networks, will be published this spring by Verso. Research assistance
provided by the Investigative Fund of The Nation Institute.